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Where do you park your CAD$?
March 10, 2024
7:56 am
Alexandre
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COIN said
Why not park your funds in an HISA?  

Where is the fun in doing that?

1. Visit https://www.highinterestsavings.ca/
2. Open HISA Chart page
3. Sort in descending order
4. Pick first FI on the list
5. Move money there
6. Hold (for few weeks)
7. GoTo 1

Boring!

March 26, 2024
5:25 am
finance trance
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This thread piqued my interest as to whether better options are out there for me. Excuse my limited knowledge in advance. Any insights/thoughts greatly appreciated.

I have:
- 1. Simplii Chequeing and 2. HISA (opened it bc I had the chequing acc., and as I've come to learn; occasional promo offers; current HISA one ends end of March).
- Motive HISA (TFSA)
- 1. Questrade TFSA (my investment account; index ETFS & tiny amounts of bonds), & 2. Margin account to hold cash/uninvested money for opportune undetermined moment.
- NBC Credit Card and associated chequeing account (currently no-fee).

From what I know, Motive TFSA HISA has ranked well over time. I only want to park my money and not have to think about it often, so I've assumed it fit this goal.

Questrade TFSA last I checked was good for parking money in ETFs. I purchase more shares of index ETFS perhaps 0-3 times a year (& very rarely minuscule amounts of bonds). I'm curious, for this purpose, does QT still compare okay to Wealthsimple or alternatives/competitors?

Not familiar with HISA ETFs but it's just an ETF that is supposed to somehow mimic/provide the advantages of a HISA(?), but through the market instead. Don't know ISAs as well; are they also bought within online brokerage(s), how do they differ from HISA and HISA ETFs?

Happy to provide more context if helpful, but what do you think are the best products for my scenario? I don't like complicated processes/trouble shooting/moving money monthly, but willing to stomach some of this if the best deal is good enough. Ideally, the best deal is also the simplest, like I concluded about investing years ago (i.e., buy index ETFs in a discount brokerage and forget about it). GICs are also fine to me if they are competitive (e.g., Motive offered me 120-day %5.50 GIC, Mar. 28 application deadline).

Re: the 'dry powder' comment: for my money sitting in a Questrade Margin account for a 'market collapse' or similar opportune moment to buy. Is this stupid to do (depreciation)? Should I just buy some ETF(s)? Cash ETF(s) (disclaimer: not sure what that is)?. Transfer it to one of my HISAs? Years ago I just assumed (without looking) that the time it takes to transfer from my HISAs to Questrade during a market collapse makes it better to just keep it within Questrade, even if its depreciating?

apologies on the length here.

March 26, 2024
6:17 am
mordko
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Questrade and Wealthsimple both have their advantages and disadvantages. Questrade has a more complete offering. For whatever reason, WS does not offer joint self-managed accounts or Norbert’s Gambit (for example). Wealthsimple offers better value for the products it does offer and tends to be slicker (faster transfers, more intuitive interface, etc).

Having cash sitting in Questrade is indeed wasteful. You are imposing a cost on yourself. Its like lending money at zero interest.

Long discussions here on various products for “parking” cash. Read that and see what you like. People have different views, no single solution. Personally, I think its bad maths to “park” cash while waiting for the market to drop. Comes down to the long since debunked concept of market timing. I do have quite a bit of cash (earning 6% interest) and other fixed income products which are a part of my 70/30 portfolio.

Unlike QS, WS does offer a HISA account. Pays up to 5%, if you have enough dosh with them. Moving money between various WS accounts is instantaneous.

March 26, 2024
6:40 am
finance trance
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Thanks mordko

mordko said
Long discussions here on various products for “parking” cash. Read that and see what you like. People have different views, no single solution. Personally, I think its bad maths to “park” cash while waiting for the market to drop.

Agreed on market timing. I definitely see the disagreement, I guess I was just looking for a brief consensus or uncontroversial statement of the best options, as the thread kind of lost me on what's the best rate for ISA vs HISA ETF vs HISA (and GIC while I'm at it). Besides the overall profit/return (minus fees) and the regularity with which to check in on the investment (time/effort investment), I don't think I actually have many other factors to consider.

mordko said
I do have quite a bit of cash (earning 6% interest) and other fixed income products which are a part of my 70/30 portfolio.

I'm guessing 6% is the best for a guaranteed rate investment(?) As a student with not much (well under 50k), is that available to me?

mordko said
Unlike QS, WS does offer a HISA account. Pays up to 5%, if you have enough dosh with them. Moving money between various WS accounts is instantaneous.  

Noted, will look into an account. As long as no annoying fees (e.g., inactivity) or large minimum balance I don't see why not.

March 26, 2024
7:35 am
mordko
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Ok, “well under $50K” is an important detail. Depending on how much “under”, it might not matter what vehicle you pick. 1% on $10K is $100 . Better in your pocket than the brokers but not going to change anything.

IMHO, WS is a really good option for you. No fees for buying and selling; that’s particularly helpful for small amounts. You’ll get 4.5% interest in their “CASH” account.

They also compensate for the cost of transfer and bribe you on top, depending on the amount you transfer. With a referral code you get an even larger bribe.

If you stay with Questrade, you can pick either Cash ETF or one of their money market ETFs. The latter has a slightly higher interest rate but is also a bit more volatile. 6 and two 3s.

March 26, 2024
7:44 am
finance trance
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Cheers! haha well for various factors, including my tiny budget at the moment, smaller amounts do end up meaning a lot to me haha.

The bribes, are those the promo offers? I saw a iPhone promo in the thread mentioned but that was for 100k+ deposits. I'll look at their current offers!

4.5% sounds great. I'm surprised they beat all the HISA accounts, curious how that's possible.sf-surprised

wasn't sure what the 6 and two 33s meant! Otherwise, I'll look into Cash ETFs and Money Market ETFS.

March 26, 2024
8:18 am
smayer97
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finance trance said
...
wasn't sure what the 6 and two 33s meant! Otherwise, I'll look into Cash ETFs and Money Market ETFS.  

6 and two 3s is similar to the expression 6 of one and 1/2 dozen of another...

Both mean that they are different but really add up to the same thing... in other words, nothing materially different.

March 26, 2024
8:19 am
mordko
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“6 and two 3s” means the two options are equivalent.

Looks like right now you need to move $100K to get a bribe from WS: https://start.wealthsimple.com/to/EUI1LRZe?premium&utm_content=wsaccount&utm_source=googlesearch&utm_medium=sales&utm_campaign=evergreen&utm_source=google&utm_medium=performance&campaign_id=18818435513&adgroup_id=147523656473&ad_id=648223262584&keyword=wealthsimple%20bonus&gad_source=1&gbraid=0AAAAADN8OOZCluAxTu8L5FA9s8Nvv5rCo&gclid=CjwKCAjw5ImwBhBtEiwAFHDZx3JIcZrSxqR3GnLB700lgRr70rV7gSZhakM9O1k6rAD_By1mOJUzaRoCTXMQAvD_BwE

They vary inducements monthly. Recently they bribed 0.5% of the transfer amount. You might still get it if you ask nicely.

If you know someone with WS account, get a referral code and you get at least $25 (more for moving larger amounts). Both sides get the bribe. https://promotions.wealthsimple.com/hc/en-ca/articles/19646567019035-Wealthsimple-Referral-Bonus-Promotion. Of you are stuck, I can give mine.

Apologies; looks like WS pays 4% interest if you have less than 100K with them. Goes up if you have direct deposits or larger amounts.

March 26, 2024
9:49 am
finance trance
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@mordko Roger that. Not the killer bribe I was looking for but definitely should look into WS regardless. 4% still competes with the best HISAs.

I do like the sound of the 5.50% 120-day Motive GIC offer I got recently. I guess I have options.

Maybe others aren't flustered by this, but I must admit all the acronyms confuse me easily. Researching online always brings up slightly conflicting info or half-answers.

I asked an AI, is it correct to say:
- TFSAs and RRSPs are a type of ISAs. ETFs can be invested within a ISA.
- ISAs can be bought within a brokerage account (Questrade or Wealthsimple for me)
- HISA;Cash;Money-Market ETFs vary in risk and expected return, from highest to lowest return and risk (although all are very low risk), they are: HISA ETF; Money Market ETF; Cash ETF.

For my purposes I would like the highest return/risk option. Whichever that is, do they outperform HISAs and GICs over the short-medium-long term?

March 26, 2024
10:05 am
mordko
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Highest risk/return option is stocks. Products like VGRO ETF might work for you.

You might want to read about investment basics before getting into products:

https://www.finiki.org/wiki/Main_Page

March 26, 2024
10:13 am
finance trance
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I guess I'm looking at fixed income investments more or less, something that won't lose principal or is at least safer than stocks or 'normal' ETFs. I am comfortable with the index ETFs I own, but am curious if I could do better than Motive HISA, or promotional HISA rates from Simplii/Tangerine in regards to safer investments that I don't want to risk losing principal on, but still am comfortable with investing long-term.

The downside to investing and truly forgetting about it is I also forget all the research I did in the first place. It's just unfamiliar terms that throw me for a loop. It's why I awoke from my investment slumber, as I didn't recognize HISA ETFs or ISAs as mentioned in the Savers Roundup email, although I very well could have understood what they were when I made my first big investments years back.

March 26, 2024
10:25 am
finance trance
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thank you for the link, that was actually extremely helpful.

March 26, 2024
2:09 pm
Norman1
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One can do better than the 4.1% from the Motive Savvy Savings Account with a cashable variable rate GIC if one banks at Bank of Montreal, Canadian Western Bank, CIBC, or Royal Bank and has at least $5,000:

4.75% RBC Prime-Linked Cashable 1-year GIC
4.60% Canadian Western Bank floating rate redeemable GIC
4.50% CIBC Variable Rate GIC
4.25% BMO Variable Rate GIC

March 26, 2024
8:10 pm
finance trance
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Norman1 said
One can do better than the 4.1% from the Motive Savvy Savings Account with a cashable variable rate GIC if one banks at Bank of Montreal, Canadian Western Bank, CIBC, or Royal Bank and has at least $5,000(...)

Thanks very much Norman, I'll check these out as well!

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